Preparing for a Successful Mediation

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How should counsel and parties prepare for the mediation of a business litigation case? For counsel, the process of mediation requires an entirely different mindset and style than he or she is accustomed to in court proceedings. In fact, a common mistake that inexperienced practitioners make is to prepare for mediation as though it were an adversarial court proceeding. Counsel should resist those natural impulses and instead focus on what the client needs to make the most of the opportunity presented at the mediation – that is, to get a good settlement.

When parties agree to mediate, they should be well aware of the strengths and weaknesses of their respective cases. Well in advance of the day of mediation, counsel should write his/her client a detailed analysis of the liability and damages issues in the case. It is useful for counsel to identify the 5 greatest strengths and weaknesses of the case – whether expected testimony of a witness, an email, a rule of law, the jury pool or any number of other factors that may drive a case’s outcome. (While the list might be expanded to 10 strengths and weaknesses, the marginal impact of each additional one is diminishing.) The analysis should include counsel’s considered judgment of the likelihood of success on the merits expressed in a quantitative range, e.g., 65 to 80% for a case with a very high estimate of a positive outcome. Similarly, the range of possible damages should be estimated in the event of a finding of liability. The report should include an estimate of attorneys’ fees and expenses through trial.

It is extremely useful for a client to do the same thoughtful analysis independently. What does the client see as the 5 or 10 major strengths and weaknesses of its case? How do the lists compare? Are counsel and client on the same page about the real issues at hand? The discussion of specific strengths and weaknesses helps ferret out different perceptions that the client and counsel may have about evidentiary issues, the credibility of witnesses and the certainty of applicable law. The client’s estimations of the damages range and the likelihood of liability findings serve the same purpose.

Along with breaking a case down along quantitative lines as rigorously as possible, the qualitative aspects of the case must be explored and considered. Examine the non-monetary terms that could be part of an appealing settlement. A settlement reached in mediation will usually enable a complexity in an outcome that is simply not possible to achieve in a court case. For instance, in a close corporation dispute, there may be a host of issues including the delineation of assets, non-competition, the valuation of shares, continuing relationships of family members as employees or shareholders, and the like, which are more manageable to resolve in mediation.

Finally, it is important for counsel and clients to examine the psychological dimensions of the case. The weight of an ongoing business litigation case is invariably great for all concerned. Often the litigation is merely a culmination of destructive issues that have developed over time. Any litigant should reflect on the psychological benefits to all of reaching an end to the litigation.

If all of this ground is covered, a client will be well prepared for a detailed and substantively rigorous mediation. Of course, mediation does not always succeed. Some parties use the process for purposes other than settlement – for discovery, for instance. Other parties might use mediation to bully or demoralize. However, if both parties engage in mediation in good faith and have done their homework, there is a very good chance that the mediator will help them find an acceptable point in the zone of a reasonable settlement – by definition, one that nobody likes, but everyone can live with.


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